In the wake of a recent U.S. Government Accountability Office (GAO) report sparked by Aviation Week Intelligence Network (AWIN) stories, the U.S. Navy is striving for better cost estimates for its future Littoral Combat Ships (LCS).
“In response to a recommendation in our July 2013 report, DOD now plans to do an independent cost estimate for the program before its next seaframe contract award in 2016,” GAO says in a recent for-official-use-only report, “Littoral Combat Ships, Navy Needs to Address Communication System Limitations and Obtain Additional Operational and Cost Data,” obtained by AWIN.
Such an estimate is important, GAO says. “If the Navy follows the LCS Plan of Action and Milestones, it may contract for the entire fleet of . . . LCS ships before actual operational information is obtained for both variants.”
The LCS comes in two variants. One is based on the LCS-1 USS Freedom design, featuring a steel monohull and aluminum deck, and is being built by a team led by Lockheed Martin. The other variant is an all-aluminum trimaran based on the LCS-2 Independence design, being built by a team led by Austal USA and General Dynamics.
The GAO notes: “The Navy plans to finalize its request for proposals for up to 28 additional LCS ships in late 2014, before it incorporates lessons learned from the USS Freedom deployment into the LCS CONOPS (concept of operations) or gains similar operational data for the Independence variant.”
The Navy expects to consider contract proposals for additional LCS ships in early 2015 and to finalize the contract award in early 2016. “Although DOD said that it would update the seaframe cost estimate, there is no requirement to do so prior to 2016,” GAO says.
But now the Pentagon has agreed to “identify actions and milestones to collect actual operational data on the second variant (Independence), and update operational support and sustainment cost estimates and strategy documents for both variants prior to contracting for additional LCS ships in 2016,” GAO says.
The GAO explains that such updated data could put the program in a new light, given some of the programmatic changes thus far, such as the increase in the number of crewmembers and shore support staff.
Part of the problems, GAO says, may be in the way the Navy calculated its initial cost estimates.
“In lieu of actual LCS data, the Navy used operations and support data from other surface ships, such as frigates, that were modified to approximate LCS characteristics to build the LCS cost estimate (referred to as modified analogous data),” GAO says. “For example, cost estimators used modified frigate data to estimate sustaining support costs such as munitions handling, and to estimate non-maintenance supplies and equipment costs. Maintenance estimates were calculated by modifying analogous data from frigates and destroyers, among other ships, even though their maintenance concepts differ from those of the LCS.”
Navy officials say that until they have actual operational data on both LCS seaframes, it is unknown whether the modified analogous cost data will reasonably correspond to actual LCS costs, according to GAO. The officials added that the seaframe estimate cannot be updated further without additional actual LCS operations and support data, including lessons learned from the USS Freedom’s ongoing Singapore deployment. Navy liaison Lt. Caroline Hutcheson says obtaining the needed data is one of the most important elements of Freedom’s deployment.
But the issue is more than just the ships, GAO says. “In contrast to the lack of actual data for the seaframes, Navy officials told us that some portions of the mission modules such as sonar systems, guns, and missiles are used on other ships and cost estimators have actual operational data on which to base their estimates. However, not all mission modules have been operationally deployed overseas on an LCS ship, which raises uncertainties as to whether the modified analogous cost data will reasonably correspond to actual LCS costs.”
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